WASHINGTON -- While urging the president and Congress to take steps to
prevent future Medicare overpayments such as those uncovered by a recent
audit, the Concord Coalition today warned that the savings from such an
effort would not come close to making the program solvent over the next
five years and beyond.

The audit of Medicare, released yesterday by the inspector general of the
Department of Health and Human Services, estimated that the program
overpaid healthcare providers by $23 billion last year.

"Taxpayers are justifiably outraged when told of the improper payments that
occur in the Medicare program, and they are right to demand corrective
action," said Martha Phillips, executive director of the Concord Coalition.
"But unfortunately, these overpayments are not the primary reason
Medicare's costs are growing out of control."

Phillips said the real cause of Medicare's rapid annual growth has to do
with the lack of cost-saving incentives in the program, the brisk
development of new technology, and changing demographics.

She said the estimate of overpayments uncovered by federal investigators --
which could total $115 billion over the next five years if left uncorrected
-- pales in comparison to the $383 billion cash deficit Medicare Part A and
Part B are predicted to run over the same time span. That $383 billion
deficit, which must be covered by general revenues from the U.S. Treasury,
is the amount of savings that would be needed over the next five years to
keep the program from adding to the federal deficit.

"It is critical that we root out waste and fraud, but this effort must not
be used as an excuse to avoid the reforms that are needed to save Medicare
over the next five years and beyond," Phillips said. "Medicare is
completely unsustainable in its current form with or without waste, and
Congress and the president must act now to protect its future beneficiaries
and taxpayers."